"It's Giving Green!"

Hi There! As the new year begins, I find myself not drawn to resolutions in the traditional sense. Instead, I prefer to look back at the year gone by and ponder over all the aspirations I hold dear – my personal growth, health, financial stability, business endeavors, and family happiness. It's during this time of reflection that I set for myself a big, bold, and somewhat daunting goal. But it's not just about setting this goal; it's about carefully charting a path towards it, marked with key milestones. This approach fills me with a sense of purpose and direction, guiding me through the year with clarity and determination.

 Alright, let’s dig in!

2023 Market Recap:

• Santa Claus Rally: On the last trading day of the month, the market experienced the much-anticipated Santa Claus rally. The Nasdaq, S&P 500, and the Dow saw modest increases of about 0.06%, 0.02%, and 0.09%, respectively.

• Market Performance in 2023:

  • Despite recession concerns, the economy remained strong.

  • The S&P 500 impressively grew by 24.5%, while the Dow Jones increased by 13.6%.

  • The Nasdaq outperformed with a remarkable gain of 54.4%.

  • Conversely, crude oil declined by over 10%, influenced by geopolitical instability and uncertainty about global oil output.

• Driving Factors:

  • The economy's resilience and advancements in Artificial Intelligence (AI) played important roles in the market's rally.

  • Notable tech companies such as Nvidia, Meta, Microsoft, Amazon, and Apple witnessed significant gains, bolstering the tech sector's overall performance.

In 2024, key economic factors to watch:

• Continued Recession Concerns: The shadow of a potential recession still looms as we enter 2024. The complete effects of the Federal Reserve's rate increases are yet to fully permeate the economy. However, clarity is on the horizon, with the next earnings season starting in early January, offering insights into the economic trajectory.

• Oil Market Volatility: Analysts anticipate ongoing volatility in the oil market. This instability is largely attributed to geopolitical tensions and the risk of these conflicts expanding regionally. Consequently, oil prices are expected to stay below the $80 mark, reflecting the cautious outlook of the market.

• Federal Rate Cuts and Market Optimism: There's a growing belief among investors that the Federal Reserve might implement rate cuts in 2024. This expectation is fueling optimism in the financial markets, as it suggests a "soft landing" could be achievable. Such a scenario would be a relief for investors, balancing out the prevailing uncertainties.

It’s another short week in the markets!

• Recent Economic News:

  • S&P Global US Manufacturing PMI for December was lower than expected.

  • ISM Manufacturing PMI for December exceeded expectations.

• Key Points from FOMC Meeting Minutes released on 1/3/24:

  • Unanimous decision to keep the Federal Funds Rate steady.

  • Open to more rate hikes if needed, but also considering rate cuts in 2024.

  • Possible to maintain current rate levels longer than expected.

  • GDP growth might be overestimated, as suggested by weaker GDI growth.

• What to Watch on Friday:

  • US Average Hourly Earnings.

  • US Unemployment Rate.

  • US Non-Farm Payrolls.

  • US ISM Non-Manufacturing PMI and Prices.

The most anticipated earnings releases this week are outlined in the chart below.

This Week’s High-Impact Global Economic Data Highlights:

• Germany Unemployment Rate and CPI

• Euro Area CPI

Trading Tip: Central banks cut interest rates to stimulate the economy, encouraging cheaper borrowing and spending, which often leads to bullish market sentiment!

Week 12/24/23 - 12/30/23 Recap

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Disclaimer: This newsletter is strictly educational. The information this report provides does not constitute investment, financial, trading, or any other advice. You should not treat any of the report’s content as such. Please be careful and do your research.